Anadarko Petroleum (APC) Profits and Sales Fall, But Beat Wall Street Views (Update)

November 2, 2009 5:37 PM EST

(Update with comments from analysts)

Anadarko Petroleum Corporation (NYSE: APC) reported a third-quarter adjusted loss of 11 cents, 22 cents better than the market estimate of 33 cent loss.

While all oil and gas companies are dealing with a drop in demand and lower price of their products, they are also being compared to a the year-ago period when the industry was enjoy one of its most lucrative periods in history.

Anadarko reported a net income of $200 million, or 40 cents a share. This included $251 million in special items that added 51 cents per share for the Company.

Total revenue for Anadarko dropped dramatically in the third-quarter to $2.7 billion, down from $6.15 billion in the same quarter last year.

The exploration and production company is hoping that the lack of severe weather in the Gulf of Mexico and the new oil deposits found in the deep waters off the coast of West Africa will help drive up total volume and allow the company to grow.

"This equates to a forecasted growth rate of approximately 7 percent over our 2008 total sales volumes of 206 million BOE, while spending approximately 35 percent less capital on near-term projects,” Anadarko Chairman and CEO Jim Hackett said.


Analyst Comments:
Analysts with Wells Fargo have maintained an Outperform rating and a $78 to $82 price target on Anadarko. The analysts cite the raised 2010 earnings per share guidance for the company from $1.04 to $1.56, along with the very strong production number as reasons to forecast positive results for the shares.

“Exploration provides shareholders upside potential, and significant cash generation provides ample flexibility in funding the company’s budget allowing continued growth in the future, despite sliding commodity prices,” Wells Fargo analysts stated.

Anadarko is currently priced at $61.84 per share before the market opens today.

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